PHARMA INDUSTRY OUTLOOK IN NEXT DECADE

Factors impacting on the fortunes of the worldwide pharmaceutical industry over the next decade were discussed by Rhone-Poulenc Rorer's executive vice president, Randy Thurman, at Lehman Brothers' 5th annual European health care conference, held in London last week.

The drug industry is now facing decreasing profit margins and less pricing flexibility, and the single digit growth rates currently being reported will extend into the future, said Mr Thurman. One of the keys to being competitive in this environment, he added, is restructuring, both in the sense of mergers and acquisitions and in terms of shedding unnecessary costs, such as duplicate manufacturing plants and overstaffing.

As far as staff are concerned, Stewart Adkins of Lehman pointed out that he and his colleagues had recently forecast that if the industry is to achieve cost savings to maintain profitability, some 50,000 jobs (or some 10% of staff in their universe of companies) will have to go.